When we first met the client, the former attorney for Backyard Brine (“BB”) had sent a demand letter to Backyard Food Company (“BFC”), saying that BFC’s name was confusingly similar to their own, especially in connection with pickle products.
BB sent the demand letter the day after learning about BFC’s using its trademark in connection with pickles – the primary product of BB. Fortunately for the client, the Trademark Office had also agreed that BFC’s application for BACKYARD FOOD COMPANY was confusingly similar to the plaintiff’s registered trademark for BACKYARD BRINE. On three different occasions, the Trademark Office refused to register BFC’s application in connection with pickle products.
Flash forward, and we were contacted by the plaintiff. The first thing we had to clarify was when their attorney had sent the demand letter. They were vague, and I had to stress the importance of doing it quickly to avoid a claim of laches. (Laches is the equitable concept of reasonable reliance on the plaintiff not commencing a lawsuit to enforce its rights, and being prejudiced by relying on that delay in enforcing the rights.)
There’s no statute of limitations for trademark infringement claims. Instead, the court determines whether laches bars a claim based on the relevant state’s statute of limitations for an equivalent claim. Trademark infringement is a kind of tort because it involves infringing on someone’s rights — and in New York, the statute of limitations for torts is a six-year period.
The next day we commenced Backyard Brine v. The Backyard Food Company (EDNY): five years and 51 weeks after the date of the demand letter. The defense, thinking they smelled blood in the water, brought a motion to dismiss the action alleging the claim was barred by laches. They argued that plaintiff was too late because the case hadn’t been filed for almost six years after the demand letter.
However, the operative word in that sentence is “almost.”
We came back with an ample number of cases saying that, when the time period is more than six years, the burden of proof shifts from the defendant to the plaintiff (and, to be sure, the plaintiff normally loses under those circumstances). In contrast, there were no cases indicating that if the time period is less than six years, the doctrine of laches prevents the lawsuit from going forward. We presented an additional set of cases saying that if a defendant continues to use an infringing mark after receiving a demand letter, then they do so at their own risk. (That’s the doctrine of “unclean hands”, which prevents the defendant from enjoying an equitable defense like laches.)
BFC replied and we waited almost exactly a year for the judge to decide – and deny – defendant’s motion to dismiss. The judge gave us the added pleasure of citing the case law and the arguments that we had submitted, and paved the way for the claim of confusingly similar trademarks to go forward.
